Cultural icons like David Beckham and the Royal family are giving British luxury brands a helping hand to outperform their global rivals in China, new research shows.
China’s love for British luxury goods is all too clearly demonstrated by the sales figures.
Diageo, for instance, gets about a third of its profits from Scotch whisky brands, Jaguar Land Rover saw sales in China up 39% in January this year while UK fashion giant Burberry has seen sales jumped 20% in the past year.
A survey of Chinese consumers in Shanghai and Beijing found that Britishness is all the rage among China’s nouveau riche.
The Royal family and David Beckham were voted as the top link between Chinese consumers and Britishness, followed by the Football Premier League and the 2012 London Olympics.
TV programmes and movies like Downton Abbey, the Harry Potter films, Sherlock Holmes, James Bond and BBC News also had a huge influence on the Chinese perception of Britishness, as does the British elite education system represented by Oxbridge and the public schools.
“Luxury goods are defined as those satisfying hedonistic rather than functional needs and our research has found this is an area that Britain enjoys a distinct advantage in,” said project leader Qing Wang, professor of marketing and innovation and associate dean of Warwick Business School.
“A very important factor that makes Britain standout is that it incorporates tradition and innovation seamlessly,” she said.
Britain’s advantage, the research shows, lies in the so-called soft power approach, which is defined as the ability to get what you want through attraction rather than through coercion.
“As China promotes its own soft power, it has increasingly turned to Britain for inspiration,” Wang added.
Navdeep Athwal, doctoral researcher in Warwick Business School’s marketing group, added the lure of luxury spreads into other consumer segments.
“There is a trickle-down effect from the tailor-made luxury product segment with high price tags and exclusivity benefits to other consumer segments where more affordable and mainstream luxury goods are offered.”
“Members of luxury goods consumer-led virtual communities seek to emulate the behaviour of their elite counterparts and to gain the same levels of status and recognition.”
Wang added this trickle-down effect of conspicuous consumption to middle-class consumers is threatening the very essence of luxury being exclusive.
“Emerging markets like China and India offer huge potential for luxury marketers where advertising efforts should focus on ‘selling the dream’ and creating stronger ties with the super-rich.
“For luxury firms unique and customised product offerings combined with exquisite craftsmanship and the British association will continue to drive sales in emerging markets,” she added.